India April 2 Weekly Newsletter 2012

This document covers news related to India with a special focus on areas like mergers & acquisitions, private equity & venture capital.

Volume 127, April 2nd, 2012

For the period March 26, 2012 to April 1, 2012 April 2, 2012 [INDIA WEEKLY NEWSLETTER]

Highlights

Phillip Capital To Acquire MF Global Sify Securities India…(3)

Germany Based STEAG To Acquire 5% In Content Pages Hinduja National Power…(4) TRF Acquires 49% Stake In York Transport Mergers & Acquisitions News 3-5 Equipment…(5)

Mergers & Acquisitions Deals 5-8 Gruner + Jahr Acquires Digital Ad Network Networkplay …(6) Private Equity News 8-10 IMFL Maker Tilaknagar Industries Buys Four Private Equity Deals 10-13 Cos…(7) A2dc Acquires Gurgaon based Mobile Venture Capital News 13-14 Marketing Firm – Mobimasta…(8)

Venture Capital Deals 14-16 Michael & Susan, Bellweather May Exit Ujjivan Financial…(9)

CX Partners To Invest Rs200 cr in Sutures India…(10)

Valiant Mauritius Invests In Shriram Housing Finance…(11)

DTL Ancillaries Raises $10 mn From India Industrial Growth Fund…(12)

SIDBI To Invest In CashPor Micro Credit…(13)

Exotel Raises Funding From Mumbai Angels & Blume Ventures…(14)

Nirvana Venture Buys 10% In Games2win…(14)

Accel Partners Invests $2.8 mn in Cloud Firm Enterprise Nube…(16)

Confidential LKP Securities Limited 2 April 2, 2012 [INDIA WEEKLY NEWSLETTER]

Mergers & Acquisitions News

Jindal Poly Films To Divest 60% in French Subsidiary - Jindal France SAS

Jindal Poly Films Limited, a part of Rs3,000 cr BC Jindal Group is divesting 60% in Jindal France SAS. Pursuant to this disinvestment, Jindal France SAS and Rexor S.A. will cease to be subsidiaries of the company. In 2003-04, Jindal Poly Films acquired Rexor S.A. through its subsidiary company Jindal France SAS. Rexor S.A. manufactures Coated Films, Hot Stamping Foils, Security Threads, Tear Tapes etc. With the acquisition of Rexor in France, Jindal was able offer a full range of thin and thick BOPET films and BOPP film products required by large flexible packaging converters and end-users. Jindal Poly Films is involved in manufacturing of polyester films, polypropylene film, steel pipes and photographic products.

Future Group May Acquire NCR Based Big Apple Chain Of Grocery Stores

Future Group may acquire NCR based Big Apple chain of food and grocery stores. Though the exact valuation is not known, the final deal size could be close to Rs250 cr. Big Apple Chain is owned by Express Retail Services Ltd, a joint venture of Lalwani Holdings and the Chaurasia Group. It currently operates 65 stores in and around NCR. The company recently forayed into home delivery format under 'Day2Day' brand. With the new format, the company is eyeing a customer base of around two lakh families in Delhi and NCR in the next 30 months targeting revenues of Rs400 cr. Last year, the company also announced it's plans to the wholesale segment by launching a new format. The wholesale venture was to be launched by Thinkfresh International Pvt Ltd, a subsidiary of Express Retail Services. The company is talking to Japan’s Mitsubishi Corporation and Lawson for a stake sale in it's food sourcing business. Future Group is planning to form a holding company where his group’s stakes in the various operating companies will first get transferred and then the foreign partner will pick upto 49% stake. That would cover the food parks, the agri and dry grocery sourcing unit Future Agrovet, Future Farm Fresh, the fresh fruits and vegetables sourcing entity, private label divisions like Capital Foods and Future Consumer Enterprises, and the cash-and-carry distribution set-ups of Aadhar, and KB’s Fair Price stores.

Phillip Capital To Acquire MF Global Sify Securities India

Singapore based Phillip Capital is acquiring MF Global's India broking business in an all cash deal. The transaction is subject to regulatory and statutory approvals in the respective countries. MF Global Sify Securities India is a 70:30JV between MF Global and Sify Technology Ltd. It has been on the block after it's parent MF Global Holdings filed for bankruptcy protection in October last year. If this transaction goes through, it will be the second time that the ownership of the broker will change hands. It was initially set up as a JV between Refco Inc and Sify with the US firm holding 70% stake. MF Global acquired majority stake in the company in November 2005 after Refco filed for bankruptcy. MF Global has

Confidential LKP Securities Limited 3 April 2, 2012 [INDIA WEEKLY NEWSLETTER] been in business since 1999. It offers online and offline equity and derivatives trading for retail customers as well as execution and clearing services for financial institutions. Phillip Capital offers a full range of financial services including fund management, unit trusts, hedge funds, insurance planning, investment research and broking in bonds, securities, futures, foreign exchange, precious metals and commodities.

Germany Based STEAG To Acquire 5% In Hinduja National Power

Germany based energy major STEAG GmBH has agreed to acquire 5% stake in Hinduja National Power Corporation Ltd (HNPCL) through its subsidiary STEAG Energy Services GmbH. According to the agreement between the two entities, STEAG will have the option to invest in future power projects of the group. Besides, Hinduja group's power sector holding company Hinduja Energy India Ltd is forming JV with STEAG Energy Services (India) Pvt Ltd for operations and maintenance of various power projects in India. This JV will operate the Visakhapatnam plant of HNPCL and would also carry out operations and maintenance activities of new power projects in India. HNPCL's 1,040 MW coal-based thermal power plant is currently in advanced stages of construction for commissioning in 2013. Hinduja National Power Corporation Ltd promoted by Hinduja Group, is setting up a coal-based sub- critical thermal power plant of 1,040 MW (2X520 MW) in Vishakhapatnam. The total cost of the project is Rs5,545 cr which is being funded at a debt-to-equity of 3:1. The company has awarded EPC contracts for both Boiler-Turbine-Generator and Balance of Plant to Bharat Heavy Electrical Limited, which has a well-established track record in the field. The company has signed an agreement with Evonik Energy Services (India) Pvt. Ltd. for the Operation & Maintenance (O&M) to ensure efficient operations and high plant availability.

Vijay Mallya May Sell United Breweries Stake To Heineken

Tycoon Vijay Mallya, scrambling to raise funds to rescue his ailing Kingfisher Airlines Ltd, is considering the sale of all or part of his stake in United Breweries (UB), his flagship beer business, to Dutch brewer Heineken NV. They added that Mallya has the option of selling a stake in UB to ease his financial woes, and Heineken would be a keen buyer to gain control of India's biggest brewer and maker of Kingfisher beer. The Amsterdam-based brewer holds a 37.38% stake in UB as a legacy of its takeover of Scottish and Newcastle in 2008. The purchase of 13%, valued at $370 million at current market prices, would be enough to take Heineken over the 50% mark. Mallya owns around 19% of UB and has held talks with a number of different parties to try and raise cash for his ailing Kingfisher Airline.

DTDC To Expand In West Asia Through Acquisitions

Courier Services provider – DTDC is planning to acquire a company in West Asia for expansion. The company has set up joint ventures in Canada and China and also planning expansion in Australia in next two years. DTDC is also planning to strengthen the business by servicing e-commerce and other Cash-on-Delivery (COD) businesses specifically. Incorporated in 1990, DTDC Courier & Cargo Ltd is an Express distribution company in India covering both domestic and international services. It has a delivery network covering close to

Confidential LKP Securities Limited 4 April 2, 2012 [INDIA WEEKLY NEWSLETTER]

10,000 Pin codes and international network spans over 240 global destinations supported by its own offices in US, UK, Dubai, Singapore, Canada, Bangladesh, Hong Kong, Sri Lanka, Nepal and Turkey. Bangalore headquartered DTDC has its Zonal offices in Bangalore, Mumbai, Delhi and Kolkata supported by 300 plus own offices and over 5400 channel partner offices spread across the country delivering over 100 million shipments every year. In the retail segment, DTDC will be opening many more stores offering multiple convenience services under one roof through the brand DTDC New World.

GE India to acquire 70% stake in Advanced Systek

US-based conglomerate GE will acquire controlling stake in Advanced Systek Limited that is engaged in offering terminal automation systems and flow metering solutions. GE is aiming to get new platform for GE Energy’s growth in South Asia and the Middle East. It is probably the first independent acquisition by GE India. Earlier in 2008, GE and Mexican industrial group Xignux together acquired majority stake in Chennai-based Indo Tech Transformers. GE is learnt to have acquired 60-70% stake from Advanced Systek promoters. According to the agreement, Advanced Systek promoters Umed Fifadra and Mukesh Kapadia and other top management team members will continue to remain on board of the company along with GE nominees. Vadodara-based Advanced Systek has headcount of 220, including 160 engineers. The company caters to HPCL, ONGC, IOCL, BPCL, RIL, IBP, Gail and Oil India among others.

International Papers May Acquire Century Textiles' Paper Biz

US based International Papers may acquire Century Textiles' paper business in India for about Rs2000 cr. Last year, it had acquired 53.5% stake in Andhra Pradesh Paper Mills at Rs1400 cr. It was at a huge premium to the then CMP of the company. B K Birla promoted Century Textiles manufactures textile products, cement, and pulp and paper products. It's paper and pulp plant in Nainital, Uttarakhand has a capacity of 1.5 lakh tpa, manufacturing writing and printing paper and rayon grade pulp. It recently set up a paper board unit with a capacity of 500 tpa for Rs1,600 cr.

Mergers & Acquisitions Deals

TRF Acquires 49% Stake In York Transport Equipment

TRF Limited is acquiring balance 49% stake in Singapore based York Transport Equipment Asia Pte Limited for SGD 22.17 mn. In Oct 2007, TRF Ltd had acquired 51% stake in York Transport from Bakers Technology Limited through it's wholly owned subsidiary, TRF Singapore Pte. Ltd. and had also entered into a Call & Put Option Agreement for acquisition of balance 49% of equity shares. TRF exercised the call option to acquire 12.36 mn shares, representing 49% stake for purchase consideration of SGD 22.17 mn. York Transport and its subsidiaries manufacture trailers, axels, assemble trailer suspension kit and distribute full range of truck/trailer components. Its product are sold to OEM of trailers, builders, repair Confidential LKP Securities Limited 5 April 2, 2012 [INDIA WEEKLY NEWSLETTER] shops and major transport fleet and supported through a network of authorized marketing partner. The company serves over 300 customers worldwide and currently manufactures in Singapore, India and China. TRF Ltd - a Tata Group company, provides solutions for material handling equipment and processing system required in infrastructure development and automotive applications.

SEL Manufacturing Acquires Omega Hotels

SEL Manufacturing Company Limited has acquired 99.88% stake in Omega Hotels Ltd and 51.09% stake in SEL Aviation. Pursuant to this acquisition, both Omega Hotels and SEL Aviation has become the subsidiary company of SEL Manufacturing Company. Omega Hotels Ltd. is implementing a Hotel Project at Agra in the State of Uttar Pradesh and SEL Aviation Pvt. Ltd. is in the business of Aviation Services and holds a Non-Scheduled Operator's Permit under the Director General of Civil Aviation. SEL Manufacturing Limited is a part of RS Saluja Group of Companies. It was founded in 1969 and is headquartered in Ludhiana. It manufactures yarns, knitted fabrics, readymade garments, and terry towels.

L&T Finance Acquires Fidelity's India MF Business

L&T Finance Ltd is acquiring FIL Fund Management Private Limited (Fidelity AMC) & FIL Trustee Company Private Limited, the companies carrying on the mutual fund business of Fidelity in India. The deal is subject to regulatory approvals. Fidelity's Indian investment arm - FIL Fund Management Private Limited was started in 2004 and managed assets worth close to Rs9000 cr as of December 2011. It is headed by former Citi executive Ashu Suyash. The company has been making huge losses in it's seven years of presence in India. It has accumulated losses of over Rs 300 crore since it started operations in India in 2005 and in a global review of its asset management business had stated that it found its Indian operations failing to meet expectations. L&T Financial Services established its presence in the Mutual Fund industry through the acquisition of the mutual fund business of DBS Chola in January 2010. Since then, L&T Mutual Fund has grown its total average AUM by a CAGR in excess of ~ 33% to ~ Rs4,616 cr (average AUM for the quarter ended December 2011). It has a strong debt–focused portfolio with a pan India distribution network.

Mistubishi Pencils Acquires 13.5% In Linc Pens for Rs20 cr

Linc Pen & Plastics has announced that Mitsubishi Pencil Co Ltd is investing Rs20 cr in the company as a part of it's Business and Capital Alliance Agreement. This transaction will give Mitsubishi a 13.5% stake in the stationary products manufacturer. Linc Pen & Plastics is issuing 2 million shares at a price of Rs100 each, which translates to a premium of 110% on it's closing price of Rs47.55 on March 27. This deal values Linc Pens at Rs148 cr i.e 13.2x trailing 12-months EBITDA and 49x its net profit. According to a press release on BSE, the objective of the partnership is to improve Mitsubishi Pencil's presence and the Uni/ Uniball brand growth in India by employing Linc Pen's sales, marketing and growth capabilities and Mitsubishi's product development and writing instrument technology prowess. Linc Pen has a distribution agreement with Mitsubishi Pencil for it's Uni/ Uni-ball brand since 1992. These

Confidential LKP Securities Limited 6 April 2, 2012 [INDIA WEEKLY NEWSLETTER] brands contribute nearly 15% to Linc's domestic turnover and it is expected that this new relationship will substantially increase the contribution of the Mitsubishi brands to Linc's total sales revenue. Linc is also associated with Lamy and Bensia. Linc Pen manufactures and markets stationery products, mainly writing pens, refills, and pencils. It has more than 50 products in its portfolio. The company's manufacturing units are located in Falta and Serakole (West Bengal), and Pilerne (Goa). Linc competes with Camlin, Reynolds, Luxor and Cello Group in the Indian writing instruments space.

Readymade Steel India Acquires Singapore Based KH Forge

Mumbai based Readymade Steel India has acquired majority stake Singapore based building and construction firm - KH Forge Pte Limited. This acquisition will help the firm enter the specialized segment of foundation engineering. KH Forge specializes in bored cast in- place concrete piling and driven piling foundation work, providing complete services including design, supply, construction and project management. It is registered as a Specialist Builder with the Building and Construction Authority Singapore. It has revenues of about Rs300 cr and an outstanding order book of an equivalent amount. Readymade Steel India Ltd has been in business since 2006. It is active in manufacturing reinforcement steel bars and aims to become a complete infrastructure solution provider. It claims to be one of the pioneers in introducing the concept of ready to use steel for the construction industry in the country. It has been associated with many prestigious structures such as Mumbai Monorail, Sahar Elevated Access Road, Nashik Elevated Corridor, Phoenix Mills Market City Mumbai and Palais Royale.

Essel Group Acquires 10.19% In IVRCL

Essel Group has acquired 10.19% stake in IVRCL Limited through open market transactions. Essel Group has acquired the stake through Asian Satellite Broadcast Pvt Ltd and Jay Properties Pvt Ltd. Hyderabad based, IVRCL operates as an engineering procurement and construction company in India and the Middle East. The company also constructs transportation infrastructure, including national highways, state highways etc. Subhash Chandra-promoted Essel Group has presence in media, packaging, entertainment, technology-enabled services, infrastructure development and education. Essel group has indirect presence in special purpose vehicle floated by IVRCL – Sion-Panvel Expressway. Essel Infraprojects, another Essel group entity already has 49% in Sion-Panvel Expressway, a special purpose vehicle to build 23 km 10 lane road in Maharashtra. Essel bought 49% stake in Sion Panvel Expressway SPV from Kakade infrastructure six months back.

IMFL Maker Tilaknagar Industries Buys Four Cos

Tilaknagar Industries Ltd, maker of the brandy brand Mansion House, has acquired four companies over the past week as it looks to integrate various operations. These acquisitions will help the company build its own expertise in construction and infrastructure space while reducing raw material costs. Tilaknagar announced acquisitions of Studd Projects, My Kingdom Ventures, Srirampur Grains and P.P. Caps over the past week. Studd Projects and

Confidential LKP Securities Limited 7 April 2, 2012 [INDIA WEEKLY NEWSLETTER]

My Kingdom Ventures are engaged in construction and infrastructure development. Therefore, acquiring these companies will help Tilaknagar with rapid implementation of solutions, which in turn, will reduce costs and ensure execution of new projects within the stipulated timeframes, according to a company statement. P.P. Caps manufactures caps & containers and will, therefore, ensure cost and quality advantages. The company is also setting up a plant in Srirampur, Maharashtra, to manufacture 25 mm and 29/35 mm caps, with a capacity of 6,00,000 and 50,000 caps, respectively, per day. Srirampur Grains deals with agricultural products and will help Tilaknagar source grains directly from the farmers.

A2dc Acquires Gurgaon based Mobile Marketing Firm – Mobimasta

A2dc has acquired Gurgaon based Mobimasta, a mobile marketing agency. Mobimasta provides end to end mobile marketing services, ranging from creative ideation and development to media buying and campaign implementation. MobiMasta has clients such as Samsung, Yahoo, Coca Cola, Reebok, Adidas and NDTV. A2dc (Aquris 2bytes Digital Creation) is a JV Mobile messaging and advertising company Affle and Japanese mobile advertising firm, D2 Communications. A2DC provides total Web solutions including Web site design, system development and wireless site productions. D2 Communications is a subsidiary of NTT DOCOMO in a JV with Dentsu. Last Oct, Affle raised more than Rs50 cr in funding from D2 Communications for product development and strengthening business in existing Asian markets and launching in newer markets. In 2010, Japan’s Itochu Corporation had picked up an undisclosed minority stake in Affle Holdings, a Singapore based holding company for Affle. In 2009, Microsoft India had acquired almost 20% stake in Affle. Previous to that, it had raised $10 million in all. Other investors include BCCL (Times Of India Group) and Centurion Private Equity. Affle had also raised a Series A round from undisclosed PE companies based in the Asia-Pacific region.

Private Equity News

IFC, GEF Clean Energy Fund To Invest $4.5 mn in Kalki Communication

Bangalore based IT services firm - Kalki Communication Technologies Pvt Ltd is raising $4.50 mn from IFC and GEF South Asia Clean Energy Fund, L.P for new product development and to grow the company's business development capabilities in new and existing markets. IFC may invest $1.35 mn through quasi-equity or convertible instruments, while the balance $3.15 mn will be invested by GEF South Asia Clean Energy Fund. Additionally, IFC & GEF may finance a second round of $2 mn and third round of $5 mn equity for use in further business development activities. Bangalore based Kalki Communication was founded in 1998. It was co-founded by Prasanth Gopalakrishnan and Sushil Cherian. The company provides products, services and solutions that monitor, manage and optimize energy generation and transmission assets for public utilities and industrial clients across the world. It operates in the IT services and system integration space but also generates revenues from sales of its SYNC and ELTRIX hardware and

Confidential LKP Securities Limited 8 April 2, 2012 [INDIA WEEKLY NEWSLETTER] software product lines. In addition to selling these products directly to utilities, Kalkitech also provides ELTRIX and SYNC solutions to OEMs who bundle these products with their systems to implement solutions for utilities. GEF South Asia Clean Energy Fund is managed by GEF Management Corporation. GEF and Yes bank are the general partners in the fund. It mainly plans to invest in India, with up to a fourth of its investments in countries like Sri Lanka, Bangladesh and Nepal. IFC is currently invested in GEF through its US$10 million commitment to the fund.

HealthCare Global To Raise Rs50 cr PE Funding

HealthCare Global Enterprise Limited is planning to raise Rs50 cr PE funding for expansion. The company is planning to expand its network from the present 26 centres to 40 centres by the year 2014 for an investment of Rs100 cr. HCG is planning to invest Rs50 cr from internal accruals, while rest will be raised through PE route. The company is also planning Rs500 cr IPO by 2014. Founded in 1989, Bangalore-based HCG owns and manages a network of cancer treatment centers in India. It focuses on cancer care, diagnostics, imaging, research, and clinical trials services. It currently manages 20 cancer centres across Asia.

Michael & Susan, Bellweather May Exit Ujjivan Financial

The Michael & Susan Foundation and Bellweather Microfinance is planning to exit Ujjivan Microfinance. The investors are planning to sell their shares at Rs57 apiece and existing investor Lok Capital and an unnamed venture capital firm may be interested in acquiring the stake. Michael & Susan Foundation invested in Ujjivan in June 2006 for 13.48% stake. Recently, Ujjivan Financial Services raised Rs127.9 cr by diluting a minority stake in its latest round of PE funding. Netherlands Development Finance Company, Wolfensohn Capital Partners and existing investors – Lok Capital, Sequoia Capital, Unitus Equity, Elever Capital and Caspian Advisors participated in this round of fund raising. Earlier in January, Ujjivan raised Rs29 cr by placing NCDs with US based Developing World Markets. Ujjivan Financial Services was incorporated in 2004 as a NBFC. The company extends loans to the urban and semi-urban poor, and targets salaried and self-employed women.

Naturals Beauty To Raise Rs100 cr PE Funding

Chennai based Unisex Salon - Naturals Beauty Salon India Private Limited is planning to raise Rs100 cr PE funding for expansion. The funds raised will be used to expand its number of salons to 1,000 in the next three years. Founded in 2000 by Veena Kumaravel, owns and operates beauty salons under the name ‘Naturals’. In 2006, the company started franchising its brand. Currently, Naturals has 130 salons, of which 124 are in south, while six are in non- southern markets including Pune, Ahmedabad, Nagpur, Bhopal, Bhubaneswar and Kolkata. It also has two training academies in Bengaluru and Chennai. The company has entered into an agreement with Bharti Retail Private Limited, which joined hands with global retail brand Walmart for its retail foray, to set up salons inside easyday Market stores, which are compact hypermarket stores operated by Bharti Retail. Naturals Beauty will start the salon in

Confidential LKP Securities Limited 9 April 2, 2012 [INDIA WEEKLY NEWSLETTER] three easyday Market stores – Vaishali in Delhi, Nasik and Aurangabad. The company further plans to be present in all the 250 easyday Market stores across the country.

Carlyle Group, TPG Capital May Invest In Fortis Healthcare

Fortis Healthcare India Limited is planning to raise funds from Carlyle Group and TPG Capital by divesting 15-20% stake in the company. Fortis promoters - Singh brothers are likely to sell an additional 6.5% through a stock auction, and this may be followed by the 15%-20% placement. Fortis founders owned 81.48% of the company as at Dec. 31, 2011. They have to cut their stake to follow Indian rules, which state that the public should hold at least 25% of any listed company. In Nov 2011, the company acquired Fortis Healthcare International Pte Limited for $665 mn from RHC Financial Services Mauritius Ltd, owned by the Singh brothers. Fortis Healthcare is also planning to hive off non-core businesses and related assets into a separate company, which will be listed as a business trust on the Singapore Exchange. The company plans to raise around $300 mn through the Singapore listing by June.

Private Equity Deals

Warburg Pincus Exits Kotak Mahindra Bank

Warburg Pincus has exited Kotak Mahindra by selling it's residual 3.6% stake in the company for Rs1404 cr. About 26.5 mn shares of Kotak Mahindra Bank Ltd. were sold at Rs530 apiece in a block deal on the BSE. Warburg Pincus had part exited Kotak by selling 17.5 mn shares at a price of Rs490 per share aggregating to Rs857.5 cr in February this year. Warburg Pincus had started building up position in Kotak Mahindra in 2004. It had picked up 2.75% stake for Rs75 cr through its two entities - Madison and Melany Holdings. In 2005, it bought additional 2% stake at Rs.385 a share. It then raised its stake more than 9% by buying additional stake in various tranches.

CX Partners To Invest Rs200 cr in Sutures India

CX Partners is investing upto Rs200 cr in Bangalore based Sutures India for a 40% stake. CX Partners will buyout Evolvence Life Sciences Fund's stake and may also buy part of the promoter's stake in the company. The deal is subject to FIPB approval. Bangalore-based, Sutures India is a manufacturer and exporter of all types of surgical sutures like absorbable sutures and non-absorbable sutures. It manufactures absorbable and non-absorbable sutures, surgical tapes, gloves, surgical needles, skin staplers among other products. Sutures exports to over 50 countries in Europe, South America, Africa & Asia. It employs 120 sales personnel & supplies its products to hospitals & nursing homes through over 400 distributors. It also manufactures latex gloves through its wholly owned subsidiary - Truskin Gloves Pvt Ltd. The company had raised Rs35 cr from Evolvence Life Sciences Fund in 2009.

Confidential LKP Securities Limited 10 April 2, 2012 [INDIA WEEKLY NEWSLETTER]

Ambit Pragma Invests Rs7 cr more in Spear Logistics

Private equity investor Ambit Pragma Ventures has invested Rs 7 cr ($1.7 million) more in Pune-based contract logistics company Spear Logistics Pvt Ltd, one of its portfolio firms. The money will be utilized to implement the company’s expansion plans. In 2010, Ambit Pragma made its first investment in Spear Logistics through Ambit Pragma Fund I. Founded in 2001, Spear Logistics has a team of more than 1,800 employees and runs 75 warehouses spanning 2,000,000 sq. ft., along with supporting infrastructure. The company leases its warehouses to clients and currently operates in cities like Mumbai, Pune, Hyderabad, Ahmedabad, Bangalore, Chennai, Coimbatore, Kochi, Nasik, New Delhi and Kolkata. Ambit Pragma focuses on five major sectors including media & entertainment, healthcare, logistics, branded food and support services in infrastructure space.

New York Life Cuts Stake in CEBBCO

New York Life Investment Management India Fund has sold over 2.77% in its more than four-year-old investment in Commercial Engineers & Body Builders Co Ltd (CEBBCO) over the last two months. The shares have been sold for Rs 9-10 crore in the market at 2x returns. The fund, managed by Jacob Ballas Capital, has been reducing its stake in CEBBCO since the latter’s IPO in October 2010 – bringing the holding down to 7.32% from 12.2% at the time of the IPO. The private equity fund had also sold its stake in the IPO and through a secondary transaction with Tata Capital Growth Fund, raking in a total of Rs 40 cr from these deals. The fund invested Rs30 crore in the manufacturing company in August 2007, with an average investment cost of Rs30 per share. Tata Capital Growth Fund I picked up stake in CEBBCO from New York Life and acquired shares from the promoters as well, aggregating to Rs70 crore. It currently holds 10.93% stake in the company. CEBBCO is into manufacturing vehicle bodies for commercial vehicles, refurbishment of wagons and manufacturing of components for wagons, coaches & locomotives. Its key clients include Tata Motors, Man Force Trucks, Indian Railways and BHEL, among others.

Valiant Mauritius Invests In Shriram Housing Finance

Valiant Mauritius Partners FDI Limited has invested in Shriram Housing Finance Limited, subsidiary of Shriram City Union Finance according to announcement on BSE. Shriram Housing Finance had announced plans to raise Rs75 cr from both PE investors and the promoters by diluting 20-22% stake. Shriram Housing is the mortgage lending arm of Shriram Group. The housing finance business was started with an initial capital of around Rs15 cr. The company is engaged into asset backed lending, truck finance, personal finance, insurance and real estate. The company expects to close this year with a total loan disbursal of Rs 10 crore. Shriram Housing Finance is targeting Tier II and III markets in states like Tamil Nadu, Andhra Pradesh, Karnataka, Maharashtra and Gujarat to begin with. Shriram City Union Finance Limited, a financial services company, provides retail and non- banking financial services in India. It offers finance for two wheelers, tractors, and three wheelers, as well as for new and pre-owned passenger and commercial four wheelers.

Confidential LKP Securities Limited 11 April 2, 2012 [INDIA WEEKLY NEWSLETTER]

DTL Ancillaries Raises $10 mn From India Industrial Growth Fund

Pune based customized roll forming firm - DTL Ancillaries Ltd has raised PE funding from India Industrial Growth Fund. India Industrial Growth Fund has committed to invest a total of $10 mn in the company in two tranches for a 26% stake. The first tranche of the investment has been completed. DTL Ancillaries was incorporated by Vijay Mohan Jain in 1996. The company developed an indigenous technology for manufacturing of the railways and automotive components. It recently, became a Part-I supplier to the Railways. It makes customized cold roll formed (CRF) sections and load body fabrication for railways needed for building coaches and wagons. The company said they are growing at 35% per annum over the last five years. India Industrial Growth Fund is managed by Frontline Strategy Limited.

VenturEast, Zephyr Peacock Invest $6 mn in e2E RAIL

VenturEast Proactive Fund and Zephyr Peacock have invested $6 million or Rs 30 crore in Bangalore-based e2E RAIL, a rail services company primarily focusing on signaling, track and electrification sectors. The two private equity funds also plan to invest another $6 million in the subsequent years. The funding will be used by e2E to ramp up its global presence, training facilities and working capital capacity. e2E has operations in India and overseas markets, having worked in projects for Indian Railways, Delhi Airport Metro Express Link, Port Hedland project in Western Australia, Malaysia Railways, London Under Ground and Mecca Metro in Saudi Arabia. It has also worked with most of the leading global signaling OEM companies, both in India and abroad.

Salman Khan picks up stake in Yatra

Actor Salman Khan, who will be the brand ambassador of yatra.com, has also picked up a minority stake in travel agent Yatra Online Pvt. Ltd. Yatra did not specify how the company would be using Khan’s investment or the remuneration being given to the actor for his multiple-year contract. They, however, said yatra.com would support Salman Khan’s charitable organization called Being Human. Yatra Online is in the process of consolidating operations in larger cities such as Mumbai and Delhi and entering smaller towns in India. Yatra.com is backed by investors including Promod Haque’s Silicon Valley-based Norwest Venture Partners, Anil Ambani controlled Reliance Capital Ltd, Raghav Bahl-promoted Network 18 Media & Investments Ltd, and Intel India Pvt. Ltd, the strategic investment arm of Intel Corp. Last year, it had raised Rs200 crore to propel its hotels and holiday booking business with the help of funding led by San Francisco-based Valiant Capital Management L.P., with Norwest Venture Partners and Intel Capital participating as well.

PTC India Financial Services Sells 14.01% In IEX For Rs71 cr

PTC India Financial Services has divested 14.01% stake in Indian Energy Exchange for Rs70.76 cr. The shares were sold at Rs166.51 each. Indian Energy Exchange was jointly promoted by Financial Technologies (India) and PFS in 2007. PFS had earlier sold a 5% stake in IEX to Bessemer Venture and Lightspeed Venture Partners. It had sold the shares

Confidential LKP Securities Limited 12 April 2, 2012 [INDIA WEEKLY NEWSLETTER] at a price of Rs115.41 per share and brought down its shareholding to 21.12%. The stake sale had fetched PFS about Rs14 cr at that time. PFS originally held 26% in IEX. In 2010, Financial Technologies (India) Ltd sold 6.92% stake in IEX for Rs21.45 cr. Financial Technologies sold 18.59 lakh equity shares of IEX to foreign venture capitalists at Rs115.41 per share. Post sale it holds 33.49% and needs to bring it down to 25% by 2013. The proposed sale is part of efforts to comply with the regulatory requirements. As per the Central Electricity Regulatory Commission (CERC) norms, an entity trading in electricity cannot have more than 5% in a power exchange. Other shareholders in the exchange include Tata Power, Reliance Energy, IDFC, Rural Electrification Corporation, Adani Enterprises and Lanco Infratech.

Tano Capital Reinvests In Shilpa Medicare, Picks Up 1.5%

One-and-a-half year after its exit from active pharmaceutical ingredients manufacturer Shilpa Medicare Ltd, private equity player Tano Capital has reinvested in the public-listed company by acquiring 1.5% stake for around Rs 8 crore ($1.5 million). Tano acquired 3.5 lakh shares from ICICI Prudential Mutual Fund at Rs 225 a share. In August 2010, after making a return of 4.5x, Tano had exited the company. The PE firm had invested around $2 million in Shilpa Medicare in early 2006 from its Fund I. Prior to that, Strategic Ventures Fund Ltd (SVF), a private equity fund managed by Frontline Strategy, also exited Shilpa Medicare with 4x returns. Shilpa Medicare is a Raichur (Karnataka)-based pharma company engaged in the manufacturing of API, fine chemicals, intermediates, herbal products and specialty chemical products. It is now ready with its oncology drug manufacturing business and has developed the molecules too.

Venture Capital News

SIDBI To Invest In CashPor Micro Credit

SIDBI may provide Rs5 cr fresh capital to Varanasi-based CashPor Micro Credit for expanding it's business. SIDBI has committed 30% of its Rs100 cr microfinance development fund - India Microfinance Equity Fund (Read this) to some of the country's poorest microfinance companies, which are yet to get significant commercial funding post the liquidity crisis of 2010-11. SIDBI's Rs100 cr dedicated fund was created by the government for investing in smaller MFIs to help them overcome the liquidity crisis of 2011 and grow in a regulated environment. SIDBI will offer the debt for seven years and charge 8% interest rate a year on subordinated debt, with a clause that if any MFI converts itself into an NBFC in between, the debt may be converted into equities. The recipients will also enjoy a three-four year moratorium on principal payment. Cashpor Microcredit is a microfinance institution and is the subsidiary of CASHPOR Financial and Technical Services. It has an outstanding portfolio of Rs300 cr.

Confidential LKP Securities Limited 13 April 2, 2012 [INDIA WEEKLY NEWSLETTER]

YourNest Angel Fund Makes First Close

Early-stage venture capital fund YourNest Angel Fund says that it has made a first close, raising the initial corpus from a set of 40 individual investors including angel investors and first-generation entrepreneurs. YourNest Angel Fund – set up by Sunil K Goyal, along with Sanjay Pande – is looking to raise Rs100 crore in the next 6-9 months. Former Bharti TeleTech CEO Sunil Goyal (currently the CEO and fund manager at YourNest Angel Fund) said that for the first close, the fund had approached angel investors, entrepreneurs and professionals whom the fund managers knew. The fund would now approach institutions and the broader high net worth individuals’ (HNIs) market with this validation. YourNest Angel is registered with SEBI as a Rs60 crore fund, with a green-shoe option to raise another Rs 40 crore. The fund will invest at post-incubation stage and plans to build a portfolio of 15-18 Indian companies by investing up to Rs5 crore into each during the initial round of funding. While the fund is sector agnostic, it will back technology-enabled startups across various segments.

Elucido Media Networks to Raise Funds for Expansion

Bangalore-based Elucido Media Networks Private Limited is planning to raise Series B funding. The funds raised will be used to expand sales and marketing operations in South East Asia and US. Earlier Elucido had raised Series A funding from Trident capital in 2009. It has launched an integrated software platform – the Elucido Learning and Collaboration System (ELCS). It offers an end-to-end teaching and learning solution that is deployable with basic hardware – an Interactive whiteboard, PC/ laptop, web camera and an internet connection. Currently, it has been deployed in 60-70 classroom and is being used by about 2,500 students.

Venture Capital Deals

Exotel Raises Funding From Mumbai Angels & Blume Ventures

Bangalore based cloud telephony startup - Exotel has raised Rs2.5 cr Series A funding from Mumbai Angels and Blume Ventures. The investors will take a 25% stake in the company, valuing the startup at Rs10 cr. Exotel offers a number to a company on which they can receive & make lots of calls & SMS, all at the same time without having to invest in any infrastructure. The product is a dashboard with Sales tools, Marketing tools, Customer support tools, Business intelligence, analytics etc, i.e. all tools necessary for an enterprise to run their business smoothly over Voice & SMS. Exotel currently has over 65 clients and makes revenues of 4 lakhs per month.

Nirvana Venture Buys 10% In Games2win

Nirvana Venture Advisors, the early-stage VC fund of the Patni family, has acquired 10% stake in Games2win from a clutch of VC and PE firms, as well as from employee Confidential LKP Securities Limited 14 April 2, 2012 [INDIA WEEKLY NEWSLETTER] shareholders. Early investors Nexus India Pvt Ltd and ICICI Venture part-exited the company by selling their shares to the new investor. However, lead investors Clearstone Venture Partners and SVB Holdings have not divested their shares in this transaction. The company’s games have had a reasonable success on the Android platform and the mobile apps have crossed the 10 million download mark. The games have registered over 100 million game plays in just one month. The online games company released its first mobile game Makeover Madness in 2009 and since then, has released close to 40 apps. As of now, the company owns more than 600 proprietary games and has over 15 million players each month on its network.

IIMjobs Raises Funding From One97 Communication, India Venture Partners

IIMjobs.com, job portal for MBAs has raised seed funding from One97 Communications, India Venture Partners, Pallav Nadhani, Abhishek Rungta, Anand Lunia, Shailesh Vickram Singh, Sachin Garg and others. The funds raised will be used to develop the platform and to build a customer facing team. The company is ramping up the engineering team to build tools to help recruiters and jobseekers find each other. Founded in 2008 by Tarun Matta, iimjobs.com currently features jobs in Banking & Finance, Consulting, Sales & Marketing, HR, Legal, IT and Operations. The site is a job board, where job seekers indicate their preferences and choose their areas of interest and skills, to receive a personalized feed, which they can modify later, by unfollowing certain streams or keywords. Job listings are filtered and moderated, and metadata added, so as to target suitable candidates. At present, the site has 200,000 registered job seekers and 6,000 recruiters on board. It had earlier raised funding of Rs5 lakh from The Morpheus.

Accel Partners Invests $2.8 mn in Cloud Firm Enterprise Nube

Bangalore-based Cloud services company Enterprise Nube Services Pvt Ltd has raised $2.8 million (Rs15 crore) from venture capital firm Accel Partners. As part of the deal, Mahendran Balachandran from Accel will join the board of Enterprise Nube. Prior to joining Accel, Balachandran was a Partner at Erasmic Venture Fund and earlier worked with Apple as country general manager. At Accel, he focuses on areas like healthcare, enterprise/SaaS and digital media. Enterprise Nube was started in 2011 by former Infosys executive council member Subhash Dhar. Dhar had a 14-year stint at Infosys and at the time of leaving the company, he was senior vice-president and worldwide head of sales, marketing and alliances apart from being a member of the Infosys executive council. Enterprise Nube provides Cloud solutions for companies in marketing, sales and customer service domains and helps enhance customer engagement through social networks like Facebook, Twitter and LinkedIn. ‘Nube’ means ‘cloud’ in Spanish and the company will also provide customized Cloud service packets to companies in the digital enterprise space.

Proof of Performance Data Raises Funds From YourNest Angel

YourNest Angel Fund has invested in Proof of Performance Data Services Private Limited. The funds raised will be used for infrastructure facilities, product extensions and technology

Confidential LKP Securities Limited 15 April 2, 2012 [INDIA WEEKLY NEWSLETTER] adoption. With this investment PoP will strengthen its technology platform, Earthive. Subsequent to this investment, Sunil K Goyal - CEO of YourNest Angel has joined the board of Proof of Performance, as a director. Proof of Performance (PoP) offers insights to decision makers based on Video Analytics from the archives of the real world videos, available on it’s cloud based platform, christened Earthive. These videos are captured through pre-defined drive-throughs within the city at regular intervals. The high definition videos and allied data such as GPS coordinates are then mined to extract the required business intelligence.

Lok Capital To Invest $5 mn In IFMR Rural Channels

Lok Capital has invested $5 mn in IFMR Rural Channels for an undisclosed stake. These funds will be used for building Kshetriya Gramin Financial Services which offers financial services in remote rural locations. The KGFS portfolio includes savings, remittance, insurance, small-ticket loans and investments using a wealth management approach for low- income consumers. At present there are about five KGFS centres serving 10 districts across Tamil Nadu, Orissa and Uttarakhand.

Disclaimer

This document is being communicated to you solely for the purposes of providing the current market trends and developments based on generally available information. This document is being communicated to you on a confidential basis and does not carry any right of publication or disclosure to any third party. By accepting delivery of this document each recipient undertakes not to reproduce or distribute this presentation in whole or in part, nor to disclose any of its contents without the prior written consent of LKP Securities Limited. The recipient will keep permanently confidential information contained herein and not already in the public domain.

This document is not an offer, invitation or solicitation of any kind to buy or sell any security and is not intended to create any rights or obligations. Nothing in this document is intended to constitute legal, tax, securities or investment advice, or opinion regarding the appropriateness of any investment, or a solicitation for any product or service. The use of any information set out in this document is entirely at the recipient's own risk and should not be regarded as a substitute for appropriate detailed professional advice.

LKP Securities Limited or any of its associates or employees do not accept any responsibility for any errors whether caused by negligence or otherwise or for any loss or damage incurred by anyone in reliance on anything set out in this document. We have not independently verified the accuracy of the contents contained in this document.

The information set out herein may be subject to updating, completion, revision, verification and amendment and such information may change materially however we assume no obligation to update you of any information pertaining to the contents of this document.

Visit us at: www.lkpsec.com

Confidential LKP Securities Limited 16